A person who is issued a 1099 for work performed is considered an independent contractor and not an employee at all. This person completes contracted work as an independent worker and not as a member of an individual company or business. 1099 workers usually refer to themselves as self-employed.
Independent contractor workers must pay taxes, but by working independently, they are paid untaxed income without having income taxes, including Social Security and Medicare taxes, withheld. This allows independent contractors to receive full pay for completed work or contracts. Of course, 1099 workers must follow tax guidelines for filing yearly income taxes.
The 1099 worker for the most part determines paydays and how much she will be paid. Independent contractors can charge an additional amount for more complex contract or work assignments and can designate if they would like to be paid up front or a percentage of pay before the work is started. This is especially true if there are materials needed for work contracts.
As an independent contractor, the worker determines how much work he would like to complete, when he would like to complete it and how long he is willing to work on an independent assignment or contract. This flexible work schedule is beneficial for many people; for example, work-at-home mothers can make the work schedule work for them instead of working around a work schedule.
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